Tyumen city: breaking from oil dependency

As calls for a technology-based economy are getting stronger, Siberia’s Tyumen region – a major oil and gas producer - has been quite successful in diversifying its economy.

The Tyumen region produces two-thirds of Russia’s oil, and more than 90 percent of its gas. The oil rig is still the symbol of Tyumen region, but every year the black gold is getting harder and harder to extract, and while the going is still relatively good, the region is trying to redevelop itself as a hub of new technology.

And a decade of high oil prices has allowed the authorities to dream big. Tyumen, the regional capital, has been transformed into a jumble of skyscrapers. Construction has led the consumer boom despite high prices.

“We have been creating whole new districts from scratch,” said Artyom Zavyalov, director of a construction company. “For a while, during the financial crisis, the customers could not get mortgages, but the market has bounced back strong.”

Evgeny Arapov, project manager for one of Tyumen’s largest construction companies, says that although the economic crisis has certainly hurt the construction industry, it has also prompted companies to rethink their business practices and improve efficiency.

Making sure the oil and gas money pays well into the future is the biggest challenge. Several technology parks have been erected to provide an opportunity to modernize and innovate. But it is more complicated than just pouring money into technology – the returns are as unpredictable as they are vital.

Yulia Burova, who works for Tyumen regional government, says the objective is not only to continue advancing the region’s oil and gas industry, but also to develop new technologies in other fields, such as agriculture.

One quality that is not in short supply in Tyumen is ambition. Local engineers say that Siberia’s rugged climate has given them the idea for a perfect all-terrain vehicle. With the world’s leading carmakers cutting back, some dismiss the project as the ultimate white elephant – but not its owner, Viktor Kalinov.

“There is a real demand for these vehicles in the region,” he said. “It has no equivalent anywhere. We are not making a profit yet, but we are already breaking even.”

For all the desire to swerve from the well-trodden path, developing oil and gas expertise is not just the cash cow for today, but the key to tomorrow.

Oil giant Schlumberger has just built one of its most advanced training centers outside Tyumen – and this is the kind of international investment the area is looking for. Specialists come here from all over the world.

“What makes this so successful is that the rules are the same for those at the top and at the bottom, and that makes it different from a typical Russian enterprise,” said staff trainer Evgeny Sergeyev. “I feel we are having a radically positive impact.”

As international specialists continue to arrive in Tyumen for work purposes, more facilities to accommodate them are emerging in the city. Tomas Davies, head of the local English language school, says Tyumen is becoming a permanent posting for many international employees who can now relocate their entire families to the region. Davies’ school is one of such facilities providing educational services to both Russian-speaking corporate employees and expats’ children.

“With the development of the city, the leisure facilities, the retail facilities…Tyumen now has everything that a city of its size in the UK would have,” Davies says.

In addition to improvements in living conditions, Aleksandr Buzhan, an officer at the local branch of Interpol, says the crime rate in Tyumen has become significantly lower, in large part due to the contribution from Interpol.

Despite all the commercial development that the region has undergone, Tony Mayers, an expat of 4 years, says Tyumen’s residents have remained as affable as they always were.“They are the epitome of hospitality,” Mayers says about the locals.